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Gasoline Ends First Quarter With Smallest Gain Since 2008

March 28 (Bloomberg) -- Gasoline ended March with the smallest first-quarter gain in five years, as prices dropped below technical support.

Futures slipped as refineries returned from maintenance, boosting operating rates last week to a two-month high. Prices sank below the 20-day moving average. Gasoline has climbed 10 percent since December, the least for the January through March period since 2008. Gasoline demand over the past four weeks was 0.2 percent below a year ago.

“Technically, it looks pretty weak,” said Carl Larry, a commodities broker at Atlas Commodities LLC in Houston. “Fundamentally, it looks weak.”

Gasoline for April delivery declined 1.01 cents, or 0.3 percent, to settle at $3.1054 a gallon on the New York Mercantile Exchange.

Trading volume was 8.4 percent above the 100-day average at 2:41 p.m. Floor trading will be closed tomorrow for Good Friday.

The motor fuel rose 6.5 percent in March. April heating oil and gasoline contracts expired today.

The more actively traded May contract fell 0.12 cent to $3.1106 a gallon. May’s premium to September gasoline narrowed 1.56 cents to 15.59 cents a gallon.

May gasoline’s crack spread, or premium over WTI, narrowed 70 cents to $33.42 a barrel, the smallest gap since Feb. 14. The spread versus Brent narrowed 38 cents to $20.63.

Refinery runs, or the intake of crude for processing, climbed 364,000 barrels a day to 14.9 million, the highest level since the week ended Jan. 11, according to Energy Information Administration data.

Exit Maintenance

“As refineries exit the maintenance season, you’re going to see more products appear on the market,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.

Gasoline volatility has increased even as crude oil has moved little. The 30-day average historical volatility for RBOB was 33.3 percent today compared with 16.2 percent for crude. That’s up from 19.9 percent on Feb. 25, when crude volatility was 15.5 percent.

Heating oil for April delivery fell 0.02 cent to settle at $2.9152 a gallon on the Nymex. Trading volume was 13 percent below the 100-day average at 2:54 p.m.

Futures have declined 4.3 percent during the quarter and 1.9 percent this month. The more actively traded May contract advanced 1.02 cents to $3.047 a gallon.

Today is the last day of heating oil futures trading. The contracts for delivery in May and later months represent ultra-low-sulfur diesel fuel.

Gasoline at the pump, averaged nationwide, fell 0.5 cent to $3.645 a gallon, AAA said today on its website. Prices have dropped for the past eight days and are 26.6 cents below a year ago. Price in 2012 peaked on April 4 and April 5 at $3.936.

To contact the reporter on this story: Barbara Powell in Dallas at bpowell4@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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